Monday, November 09, 2009

Morning Briefing for November 9th: Riding the Market Bronco

Stocks (ES futures; top chart) have broken above their 10/29 and 11/5 highs around 1064, as well as their 10/27 and 11/6 highs around 1070. Those are the levels we need to see hold for an assault on the bull highs. Thus far, we're seeing three markets trade relatively in tandem: stocks, U.S. dollar (Aussie vs. U.S. dollar; bottom chart), and gold.

Thanks to David Korn for linking this article on the bucking bronco stock market. It nicely captures how the market has been able to rise significantly without a significant expansion of bullish sentiment. It also helps explain why it has been difficult for active traders and investors to ride the upward move since March.

About Me

Author of The Psychology of Trading (Wiley, 2003), Enhancing Trader Performance (Wiley, 2006), and The Daily Trading Coach (Wiley, 2009) with an interest in using historical patterns in markets to find a trading edge. I am also interested in performance enhancement among traders, drawing upon research from expert performers in various fields. I took a leave from blogging starting May, 2010 due to my role at a global macro hedge fund. Blogging resumed in February, 2014, along with regular posting to Twitter and StockTwits (@steenbab).